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The leading provider of global news, comment and analysis for the telecommunications industryFri, 09 Dec 2016 12:56:07 +0000en-GBhourly1http://wordpress.org/?v=4.1Ofcom fudges spectrum decision with token BTEE auction sanctionhttp://telecoms.com/477605/ofcom-fudges-spectrum-decision-with-token-btee-auction-sanction/
http://telecoms.com/477605/ofcom-fudges-spectrum-decision-with-token-btee-auction-sanction/#commentsMon, 21 Nov 2016 12:58:25 +0000http://telecoms.com/?p=477605UK telecoms regulator Ofcom has made a concession to smaller operators in the next spectrum auction but it is token at best.

At stake is the 40 MHz of 2.3 GHz spectrum and 150 GHz of 3.4 GHz spectrum that will be made available for auction next year. This represents the first opportunity to address big a piece of the total spectrum pie is accounted for by each operator for some time. The underdogs, as you would expect, have been vocal in imploring Ofcom to use this opportunity to level the playing field, ideally via forced redistribution from BTEE, which currently owns by far the most.

Ofcom’s solution to this is to say that BTEE is not allowed to bid for any of the new 2.3 GHz spectrum as that would give it too much. There’s some strange maths involved in Ofcom’s rationale, however. It is proposing a 255 MHz cap on the amount of ‘immediately usable’ spectrum – i.e. 2.3 GHz band and below – owned by any one player, adding that BTEE currently accounts for 45% of what’s already out there and would account for 42% of the total when the extra 40 MHz of 2.3 GHz spectrum is added.

But as a footnote to the press release Ofcom says the current total amount of mobile spectrum in the market is 647 MHz, although this does include some 3.4 GHz owned by UK Broadband subsidiary Relish. 45% of 647 is 291, so by Ofcom’s own maths BTEE is 36 MHz over the threshold. Stopping BTEE from bidding on the new 40 MHz does nothing to solve that issue.

Three, which has been the most vocal in its pleas for aggressive Ofcom intervention, is not at all happy with this Ofcom fudge – hardly surprising since it wants the total share of spectrum to be capped at 30%. BTEE is still free to bid for the 150 MHz of 3.4 GHz that is being earmarked for 5G, and would have almost half of all the spectrum if it grabbed all of it.

“Ofcom exists to promote competition and protect consumers but it has once again shown it is not willing to make the big decisions needed to deliver the best outcome for the UK,” said Three UK CEO Dave Dyson. “It has allowed BT and Vodafone to stockpile valuable mobile airwaves and put genuine choice for consumers at risk. It made empty promises to the European Commission that it would tackle this issue but it doesn’t have the courage to do so.

“The mobile industry is failing customers and Ofcom has showed it has no interest in addressing that. A 30% cap on total spectrum ownership and a spectrum reservation for smaller operators are the only measures that will preserve competition for the benefit of UK mobile consumers.”

As ever Three is playing the underdog card aggressively here, as well it might, although it’s questionable how good for the market such intervention would be. A source inside EE reminded Telecoms.com that Dyson is conveniently overlooking the forced divestiture of 1800 MHz spectrum it got on the cheap from the formation of EE, the fact that Three currently has a considerably higher ratio of spectrum to subscribers than BTEE, and that its failure to bid successfully in previous auctions is its own fault.

Kester Mann of analyst firm CCS Insight posed a good question about UK competition in general. “The proposed restraints placed on BT/EE show that Ofcom is concerned that spectrum asymmetry could harm UK mobile competition over the coming years,” he said. “However, they also raise questions as to why the BT/EE merger was waived through with such little fuss, without any apparent need to mandate divestment.”

EE CEO Marc Allera, meanwhile, kept his cards close to his chest. “While we don’t agree that competition measures should be introduced for this auction, we will now examine Ofcom’s detailed proposal carefully and respond to the consultation,” he said. “We are unique in our ambition to expand 4G coverage to 95% of the UK’s landmass by 2020, further than any other UK network has done, and will continue to use our spectrum and network to ensure UK consumers benefit from being at mobile technology’s leading edge.”

This move by Ofcom looks like an attempt to look like it’s doing something, while at the same time trying not to rock the boat. The result is a classic British fudge that does little to address the concerns of the underdogs but makes them seem ungrateful for not welcoming those few concessions they did get. BTEE will probably be happy with the decision and now the stakes look higher than ever for the upcoming auction.

UPDATE – 15:00 21/11/15: On further inspection it looks like the Ofcom 45% for BTEE is drawn from a total usable spectrum total of 567 MHz, not only leaving out the Relish 40 MHz but also 40 MHz of 1500 MHz spectrum Qualcomm flogged to Vodafone and H3G last year. This is at best confusing and at worst creative accounting. Come on Ofcom, you can do better than this.

]]>http://telecoms.com/477605/ofcom-fudges-spectrum-decision-with-token-btee-auction-sanction/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2016/11/shrugging.jpgUS broadcasters want $86.4 billion for their 600 MHz spectrumhttp://telecoms.com/473817/us-broadcasters-want-86-4-billion-for-their-600-mhz-spectrum/
http://telecoms.com/473817/us-broadcasters-want-86-4-billion-for-their-600-mhz-spectrum/#commentsFri, 01 Jul 2016 14:11:19 +0000http://telecoms.com/?p=473817The ‘reverse’ phase of the US 600 MHz incentive auction has concluded with broadcasters offering up 126 MHz of low-frequency spectrum, but they want a lot of money in return.

The ‘clearing cost’, which represents the minimum price that must be met from the proper auction, was set at $86.4 billion, which equates to around $686 million per MHz. This is at the high end of the anticipated range and calls into question the likelihood of US operators meeting the price.

“Today, bidding concluded in the reverse auction, establishing the cost for clearing 126 MHz in the TV band for wireless use,” said Gary Epstein of the FCC. “Strong participation from broadcast stations made this initial clearing target possible. Now the action shifts to the forward auction, which will give wireless bidders the opportunity to compete for this beachfront spectrum to meet America’s growing mobile data needs.”

“Broadcasters have done our part; now it’s up to the wireless industry to demonstrate the demand is there for low-band TV spectrum,” said National Association of Broadcasters EVP of Communications Dennis Wharton.

So we now move to the conventional (forward?) auction phase, in which operators can bid for spectrum in the time-honoured fashion. If the likes of AT&T and Verizon decide the price is too right for their blood then we will revert back to another reverse auction, with less spectrum, presumably in a bid to arrive at a clearing cost, and so on. This process could take us well into 2017.

]]>http://telecoms.com/473817/us-broadcasters-want-86-4-billion-for-their-600-mhz-spectrum/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2015/01/Spectrum-wave-radio-colour-signal.jpgITU globally allocates 700 MHz band to mobilehttp://telecoms.com/455712/itu-globally-allocates-700-mhz-band-to-mobile/
http://telecoms.com/455712/itu-globally-allocates-700-mhz-band-to-mobile/#commentsMon, 23 Nov 2015 15:20:57 +0000http://telecoms.com/?p=455712The ITU formally moved to allocate the 700 MHz band (specifically 694-790 MHz) to the global mobile industry at the 2015 World Radiocommunication Conference (WRC-15) currently underway in Geneva.

The specific decision taken applied only to ITU region 1, which consists on EMEA and central Asia. A similar situation is already in place for regions 2 and 3 (Americas and APAC), so now all the pieces are in place to harmonise the 700 MHz band for mobile globally, which has lots of benefits for handsets supply chain, roaming, etc. The long range of radio over the 700 MHz band will be especially beneficial for rural coverage.

“The WRC-15 decision represents a landmark in the development of broadband mobile on a worldwide scale, regardless of location, network or terminal used,” said ITU Secretary-General Houlin Zhao. “It goes a long way in enabling bridging of the digital divide, while fully protecting the other services currently operated in the band.”

“The global harmonization of the 694-790 MHz frequency band that has been decided by WRC-15 paves the way for manufacturers and mobile operators to offer mobile broadband at an affordable price in currently underserved areas,” said François Rancy, Director of the ITU Radiocommunication Bureau.

In other 700 MHz news France auctioned off eight blocks of spectrum in that band last week, with Orange and Free grabbing two each, while SFR and Bouygues settling for just the one. The French tax payer benefitted to the tune of €2.8 billion as a result of the auction.

]]>http://telecoms.com/455712/itu-globally-allocates-700-mhz-band-to-mobile/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2015/01/Spectrum-wave-radio-signal-frequency-6.jpgUK 2.3 GHz and 3.4 GHz spectrum auction to happen in early 2016http://telecoms.com/449311/uk-2-3-ghz-and-3-4-ghz-spectrum-auction-to-happen-in-early-2016/
http://telecoms.com/449311/uk-2-3-ghz-and-3-4-ghz-spectrum-auction-to-happen-in-early-2016/#commentsMon, 26 Oct 2015 11:47:46 +0000http://telecoms.com/?p=449311Ofcom has confirmed plans to release new high capacity options to mobile broadband service providers in 2016 as it unlocks previously ring fenced Ministry of Defence spectrum.

It claims it will prioritise those bidders who can make the most efficient use of the spectrum and won’t block operators that create economies of scale by buying up large adjacent blocks of spectrum. For this reason, it says, there are no plans to stop a bidding war.

In early 2016 a total of 190 MHz of high-capacity spectrum will become available in two bands, 2.3 GHz and 3.4 GHz, which are suited carrying large amount of data. This will be the biggest advance in mobile broadband capacity since 2103 when it released three-quarters of the spectrum in the 4G auction, said Ofcom.

Ofcom has set reserve prices for £70 million for the spectrum as it publishes details of the auction process. There will no cap on bidding, as Ofcom says limits could prevent a bidder from buying large blocks of adjacent spectrum, as blocks create the potential for supporting very fast download speeds and pave the way for 5G.

Ofcom says auction is designed to be fair and transparent and proposes to auction the spectrum in lots of 10 MHz for the 2.3 GHz band and 5 MHz for the 3.4 GHz band.

Many existing mobile handsets from major manufacturers, including the Apple iPhone 6, HTC Desire and Samsung Galaxy, are already compatible with the 2.3 GHz spectrum. The band is so far being used for high-speed 4G mobile broadband networks in ten countries outside Europe, including China, India and Australia.

The 3.4 GHz band is currently being used for 4G wireless broadband in six countries including the UK, Canada and Spain.

Spectrum fuels the UK’s wireless economy, said Ofcom Spectrum Group Director Philip Marnick. “This auction is an important step in ensuring that the UK has the wireless capability to deliver and support new technology,” said Marnick.

As demand for mobile data services surges, it’s not just more spectrum that’s needed but new technology to allocate it more efficiently and networks of small wireless cells to provide greater capacity over local areas. “Part of our plan to meet this demand is by making new spectrum available and allowing it to be used in a number of different ways,” said Marnick.

]]>http://telecoms.com/449311/uk-2-3-ghz-and-3-4-ghz-spectrum-auction-to-happen-in-early-2016/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2015/01/Spectrum-wave-radio-signal-frequency-4.jpgSprint aiming to cut $2.5bn from operating costs says leaked CFO memohttp://telecoms.com/445511/sprint-aiming-to-cut-2-5bn-from-operating-costs-says-leaked-cfo-memo/
http://telecoms.com/445511/sprint-aiming-to-cut-2-5bn-from-operating-costs-says-leaked-cfo-memo/#commentsFri, 02 Oct 2015 10:18:48 +0000http://telecoms.com/?p=445511Sprint is aiming to cut costs by up to $2.5 billion in the next six months and will freeze external hiring, according to a staff memo from CFO Tarek Robbiati leaked to the Wall Street Journal.

The memo says all expenses must now be reviewed and approved by the finance department in a bid to make savings of between $2bn and $2.5bn.

“When requesting to spend money take an owner’s mindset by treating every dollar as if it were your own,” Robbiati has told Sprint employees.

The memo comes at the end of a week that started with Sprint announcing it would not take part in the 600 MHz Incentive Auction scheduled for March 2016, explaining that its current spectrum holdings are sufficient to meet demand for existing and future. “Sprint has the spectrum it needs to deploy its network architecture of the future,” said Sprint CEO Marcelo Claure on Monday.

Sprint reports it has started a major effort to increase coverage and capacity by concentrating its network and increasing the number of cell sites using its existing spectrum. The operator is using carrier aggregation to get more out of its 2.5 GHz spectrum.

Sprint reported $7.5 billion of operating expenses in the quarter ending in 30 June 2016 and said it had cut $1.5 billion in costs in the previous 12 months.

In August Telecoms.com reported US operator Sprint has celebrated ‘meaningful progress’ in its corporate turnaround strategy by appointing a new CFO, COO and CTO.

Tarek Robbiati took over as CFO having previously run an Australian consumer finance company that specialised in leasing as well as senior positions at Aussie telco Telstra. Günther Ottendorfer took over as COO, technology, having previously been CTO at Telekon Austria Group, while John Saw was appointed as chief technology officer.

“Talented and experienced executives like Tarek and Günther will be critical to accelerating our efforts to move Sprint forward,” Claure said.

]]>http://telecoms.com/445511/sprint-aiming-to-cut-2-5bn-from-operating-costs-says-leaked-cfo-memo/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2015/10/Sprint-logo.jpgFCC reveals next steps in US 600 MHz spectrum auctionhttp://telecoms.com/437761/fcc-reveals-next-steps-in-us-600-mhz-spectrum-auction/
http://telecoms.com/437761/fcc-reveals-next-steps-in-us-600-mhz-spectrum-auction/#commentsFri, 21 Aug 2015 11:37:32 +0000http://telecoms.com/?p=437761US telecoms regulator the FCC has announced its roadmap for the auction of 600 MHz spectrum, formally known as the ‘incentive auction’.

With a view to commencing the actual auction on 29 March 2016 , a bunch of preliminary steps need to be completed, starting with the Application Procedures Public Notice sometime in early autumn.

The FCC will then publicly announce the reverse auction opening bid prices for all broadcasters at least two months before the deadline specified in the public notice. This seems to be designed to determine the opening bid prices for the forward auction and there are a number of other procedure the process can apparently not manage without.

The full process, together with a bunch of links and other resources are available in the latest FCC blog post on the matter.

]]>http://telecoms.com/437761/fcc-reveals-next-steps-in-us-600-mhz-spectrum-auction/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2015/01/Spectrum-wave-radio-signal-frequency-5.jpgFrance launches 4G auction while Russia announced 1800 MHz salehttp://telecoms.com/430891/france-launches-4g-auction-while-russia-announced-1800-mhz-sale/
http://telecoms.com/430891/france-launches-4g-auction-while-russia-announced-1800-mhz-sale/#commentsThu, 09 Jul 2015 09:35:48 +0000http://telecoms.com/?p=430891France has officially launched its auction of 4G spectrum in the 700 MHz band and Russia will be offering spectrum in the 1800 MHz band in September.

The French auction was officially kicked off by Economy Minister Emmanuel Macron and junior minister for the digital economy Axelle Lemaire, according to a Reuters report. There will be six lots of 2×5 MHz spectrum offered up on the 700 MHz band made available by improvements to digital terrestrial television compression standards. A reserve price of 416 million euros has been set for each block, which will be gradually freed up over the next four years.

There are currently four Operators in France: Orange, SFR, Bouygues and Free and ARCEP, the French telecoms regulator is allowing each one to bid for up to three blocks. This could, in theory, lead to two of the operators coming away with nothing from this auction, although the result of the auction can’t result in any single operator holding more than 2×30 MHz of lower band spectrum (700 MHz, 800 MHz and 900 MHz).

Over in Russia Roskomnadzor, the telecoms agency, announced a 1800 MHz auction will happen in late September, according to Total Telecom. Specifically spectrum in the 1710-1785 MHz and 1805-1880 MHz bands will be offered up with specific chunks for each of Russia’s massive regions and it looks like winners are free to use the spectrum as they see fit.

“After 16 days and 181 rounds the spectrum auction for mobile broadband ended today in Mainz, said the Bundesnetzagentur. “All three companies, Telefónica Deutschland GmbH & Co. OHG, Telekom Deutschland GmbH and Vodafone GmbH, were successful in bidding for spectrum in line with their business models.”

The press conference isn’t until later today, so there is little additional commentary, but as you can see from the summary table below everyone got 2×10 MHz in the 700 MHz band and 2×10 MHz in the 900 MHz band. The extra investment from Vodafone and DT got each a chunk of 1500 MHz and some extra 1800 MHz spectrum.

Incidentally France has set the conditions for a digital dividend auction of 700 MHz spectrum to happen before the end of this year and has set a reserve price of 2.5 billion euros.

]]>http://telecoms.com/426751/vodafone-highest-bidder-in-5-billion-euro-german-spectrum-auction/feed/1http://telecoms.com/wp-content/blogs.dir/1/files/2015/01/Spectrum-wave-radio-signal-frequency-4.jpgOfcom unveils plans to auction new 2.3 GHz and 3.4 GHz spectrumhttp://telecoms.com/422841/ofcom-unveils-plans-to-auction-new-2-3-ghz-and-3-4-ghz-spectrum/
http://telecoms.com/422841/ofcom-unveils-plans-to-auction-new-2-3-ghz-and-3-4-ghz-spectrum/#commentsTue, 26 May 2015 11:32:48 +0000http://telecoms.com/?p=422841UK telecoms regulator Ofcom has announced plans to auction spectrum currently being used by the Ministry of Defence in the 2.3 GHz and 3.4 GHz bands.

Today’s statement marked the commencement of a public consultation on how best to proceed with the auction and how much of the 190 MHz of total spectrum to make available initially, only 40 MHz of which is in the 2.3 GHz band. Ofcom seems to think holding back 60 MHz would be the best way to ensure “optimum use of spectrum”.

Having announced the public consultation, Ofcom went on to lay out a number of decisions it has already made. These include the use of a single, multi-round ascending format (as opposed to combinatorial clock auction), and the splitting of the 2.3 GHz spectrum into 10 MHz lots and the 3.4 GHz spectrum into 5 MHz lots.

Since these higher frequency spectrum are better suited to boosting capacity rather than coverage there will be no coverage obligations attached to any of the lots. The consultation will close on 26 June and some or all of the spectrum could be made available this year if that’s what the consultation concludes.

]]>http://telecoms.com/422841/ofcom-unveils-plans-to-auction-new-2-3-ghz-and-3-4-ghz-spectrum/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2014/12/Ofcom-logo.jpgRogers opts out of C$2.1bn Canadian AWS-3 auctionhttp://telecoms.com/406441/rogers-opts-out-of-c2-1bn-canadian-aws-3-auction/
http://telecoms.com/406441/rogers-opts-out-of-c2-1bn-canadian-aws-3-auction/#commentsMon, 09 Mar 2015 11:03:04 +0000http://telecoms.com/?p=406441The Canadian government has announced the results of its AWS-3 (1755-1780 MHz and 2155-2180 MHz) spectrum auction and they reveal that Rogers, which is Canada’s leading operator by subscription, decided not to buy any of this batch of bands.

C$2.1 billion Canadian dollars were spend on the latest tranche of spectrum, with a key feature of the auction being that a large chunk of it was set aside for smaller players and new entrants. Outside of the big three Canadian operators, Wind, Videotron and Bragg all grabbed some share.

According to Ovum’s WCIS service Rogers is the Canadian market leader, with Bell and Telus close second. Between them they account for around 90% of all subscriptions so the Canadian regulator clearly sees there’s some room for greater competition. Rogers spent big on 700MHz spectrum a year ago, so it decided to leave it to the other two majors to scrap over what spectrum had been made available to them.

“Spectrum is a vital public resource and it is the government’s responsibility to allocate it in a way that encourages robust competition and choice in the wireless market,” said James Moore, Canada’s Minister of Industry. “The result of the AWS-3 auction supports our government’s policies of delivering more choice, lower prices and better service on the latest technologies.”

NEC brings together and integrates technology and expertise to create the ICT-enabled society of tomorrow. We collaborate closely with partners and customers around the world, orchestrating each project to ensure all its parts are fine-tuned to local needs. Every day, our innovative solutions for society contribute to greater safety, security, efficiency and equality, and enable people to live brighter lives. Read more…

]]>http://telecoms.com/406441/rogers-opts-out-of-c2-1bn-canadian-aws-3-auction/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2013/02/canada-flag.jpgOfcom launches consultation on bands above 6GHz for 5Ghttp://telecoms.com/382762/ofcom-launches-consultation-on-bands-above-6ghz-for-5g/
http://telecoms.com/382762/ofcom-launches-consultation-on-bands-above-6ghz-for-5g/#commentsMon, 19 Jan 2015 16:13:11 +0000http://telecoms.com/?p=382762Ofcom has launched a consultation seeking industry input on spectrum bands above 6GHz that might be suitable for 5G. The UK regulator said that while it is not yet known what exactly 5G will be, it wants to build an understanding of future spectrum needs.

The competition authority said it is expected 5G will offer much faster speeds, possibly 10 to 50 Gbit/s compared to current average 4G download speeds of 15Mbit/s.

“We want to explore how high frequency spectrum could potentially offer significant capacity for extremely fast 5G mobile data,” Philip Marnick, Ofcom Spectrum Group Director, said. “This could pave the way for innovative new mobile services for UK consumers and businesses.”

The very high frequencies of 6GHz and above are currently used by various organisations, including scientific research, satellite broadcasting and weather monitoring. Ofcom said these bands, which have the potential to support very high demand areas and users, could be made available to the wireless industry. Ofcom reckons the bands could also support a variety of uses such as financial trading, entertainment and gaming, as well as holographic projections.

“We want the UK to be a leader in the next generation of wireless communications,” Steve Unger, Ofcom Acting Chief Executive, said. “Working with industry, we want to lay the foundations for the UK’s next generation of wireless communications.

“5G must deliver a further step change in the capacity of wireless networks, over and above that currently being delivered by 4G. No network has infinite capacity, but we need to move closer to the ideal of there always being sufficient capacity to meet consumers’ needs.”

One of the reasons Ofcom is looking at these high frequencies is the simple fact that there isn’t much availability lower down the spectrum. However, if as a result of the consultation Ofcom decides to allocate these bands for the mobile industry, they will most likely be traded at an auction in the same way as happened before 4G and 3G.

Spectrum auctions historically can generate a nice chunk of money for the government, and the fees are one reason why operators can sometimes express frustration at the keenness for the next generation technology. Understandably they would like to see some return on their investment before having to fork out another load of cash at the next auction.

Ofcom is not the first to consider the significance of higher frequency spectrum for 5G. Ericsson for example recently announced the addition of license assisted access (LAA) to its small cell portfolio. This LTE technology allows users to tap into unlicensed spectrum, typically used by wifi, to augment their cellular performance. According to Ericsson, there is approximately 55oMHz of un-utilised spectrum in the 5GHz UNII band, which it plans to use with its LAA technology.

It is also worth noting that we currently have no idea how significant these higher frequencies will be and how effectively the potential higher bandwidth will be exploited in terms of cell range, backhaul, etc. The consultation closes on February 27. Here’s an Ofcom diagram showing the historical evolution of mobile phone tech in the UK.

]]>http://telecoms.com/382762/ofcom-launches-consultation-on-bands-above-6ghz-for-5g/feed/1http://telecoms.com/wp-content/blogs.dir/1/files/2015/01/Spectrum-wave-radio-signal-frequency-6.jpgOfcom to free up 700 MHz band for mobile, eventuallyhttp://telecoms.com/304731/ofcom-to-free-up-700-mhz-band-for-mobile-eventually/
http://telecoms.com/304731/ofcom-to-free-up-700-mhz-band-for-mobile-eventually/#commentsWed, 19 Nov 2014 11:59:31 +0000http://www.telecoms.com/?p=304731UK telecoms regulator Ofcom has announced it will make the 700 MHz frequency band available for mobile broadband services, effectively moving broadcast TV and wireless microphones aside to make room. There’s no need for operators to reform their auction teams just yet though, as Ofcom doesn’t reckon it’s going to happen until 2022.

Citing a forecast that demand for mobile data will be 45x higher by 2030 than it is today, Ofcom makes the case that operator’s needs exceed those of broadcasters. “This is a crucial next step in the development of the UK’s communications infrastructure,” said Ofcom boss Ed Richards. “This decision ensures that we are making the raw materials available with which investors and companies can build the services which will support the digital economy of the future.”

The formal decision, published today, is the culmination of a consultation that commenced last May. It makes a point of stressing how kicking the Digital Terrestrial TV (DTT) channels off the 700 MHz band won’t cause any problems, while stressing the greater good is best served by giving the 700 MHz band to mobile.

In one of those handy extrapolation exercises Ofcom has calculated that this move will deliver undefined benefits to the UK of around £1 billion, but that the cost of the move will be around £600 million. Ofcom stresses that it’s down to the government to fund these costs, so it’s reasonable to anticipate another spectrum auction in the next few years.

The 700 MHz band would, of course, be very useful to operators, offering as it does superior range and indoor coverage properties, as well as potentially participating in the global APT700 LTE band. Demand for the spectrum is likely to be high and, as you can see from the Ofcom diagram below, there will be around 100 MHz of spectrum on offer. But the broadcast TV industry is likely to lobby for as much compensation for the move as possible and there are a number of other practical and regulatory hurdles to overcome before we’re living the 700 MHz dream.

Step aside DTT

]]>http://telecoms.com/304731/ofcom-to-free-up-700-mhz-band-for-mobile-eventually/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2014/07/Prism-spectrum.jpgBrazil encourages new bidders in 700MHz 4G auctionhttp://telecoms.com/269112/brazil-encourages-new-bidders-in-700mhz-4g-auction/
http://telecoms.com/269112/brazil-encourages-new-bidders-in-700mhz-4g-auction/#commentsThu, 26 Jun 2014 10:44:32 +0000http://www.telecoms.com/?p=269112The top brass of Brazilian communications regulation gathered at the Institute of Directors in central London today for the latest leg in the 700MHz 4G auction roadshow, with the apparent aim of opening up the process to new bidders outside of the four national incumbents.

A likely consequence of new bidders entering the process would be an increase in the total revenues generated for the Brazilian state, which presumably would not be unwelcome.

The presentation was opened by the Brazilian Minister of Communications – Paulo Bernardo – who was keen to stress how much progress Brazil has made in general in recent years, both socially and economically. He pointed to improvements in the GINI coefficient, which measures income equality, something Brazil doesn’t have a great reputation for, and increases in infrastructure investment.

Next up was João Batista de Rezende, President of ANATEL, the Brazilian telecoms agency/regulator. He recapped that Brazil has already had a 2.5GHz auction as that spectrum was more readily available, but that there were distinct advantages to 700MHz, including range. The 700MHz band is the result of the ‘digital divident’ from switching off the analogue TV signal, and the winners of the auction, which will be held in August, will also be responsible for the “clean up” of whatever legacy radio flotsam is still floating around.

Batista de Rezende said he expects national access to 3G to overtake that of 2G at around the time of the auction, and was keen to stress what a good commercial opportunity this auction presents. Having said that, he also stressed that there will be some advantages to those companies that have already won 2.5GHz spectrum, including the possible conclusion of some of the coverage responsibilities they signed up to merely by doubling-down on spectrum.

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Brazil has four main telco players: Vivo, TIM, Claro and Oi (which has got to be the best name we’ve seen for a telecommunications company). Only four chunks of spectrum are on offer: 10MHz for uplink and 10MHz for downlink, although one of those chinks may be geographically spit as indicated in the diagram below. So if new players enter the bidding process and win, then one or more of the Brazilian incumbents will be left with no 700MHz allocation.

It’s good to see how much effort Brazil is making to open up its market and to reduce some of the tax and regulatory burden on doing business there. Brazil is by far the largest market in a Latin America region that is one of the fastest growing smartphone markets in the world. By opening up this bidding process Brazil is sending out a positive business message and, by pure coincidence, potentially increasing its revenue from the auction.

The blocks of spectum on offer in the Brazilian 700MHz 4G auction in August

The operator acquired a total of 23MHz in the 900MHz band in Mumbai, Delhi and Kolkata and 49MHz in the 1800MHz band in Mumbai, Delhi, Kolkata, Karnataka, Kerala, Gujarat, UP East, Rajasthan, Haryana, Andhra Pradesh and Punjab.

A total of £540m is payable in financial year 2013/2014 with the remainder payable in instalments starting in 2017.

The company said it has established a strong platform for 4G data services by buying 1800MHz spectrum in Mumbai, Delhi, Kolkata, Karnataka and Kerala, which account for more than 50 per cent of data revenues and are expected to drive the adoption of 4G, as was the case after the introduction of 3G services in 2010.

Vodafone India has over 160 million customers, with the number of mobile internet users increasing 38 per cent to 45.7 million in its most recent quarter. Data usage also continues to grow strongly with 3G usage now averaging in excess of 700MB per month, the company said.

]]>http://telecoms.com/222742/vodafone-spends-1-9bn-on-indian-4g-spectrum/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2013/02/India.jpgUncertainty and risk: the results of spectrum renewal by auctionhttp://telecoms.com/197611/uncertainty-and-risk-the-results-of-spectrum-renewal-by-auction/
http://telecoms.com/197611/uncertainty-and-risk-the-results-of-spectrum-renewal-by-auction/#commentsWed, 13 Nov 2013 14:12:40 +0000http://www.telecoms.com/?p=197611In many mobile markets the original 900MHz and 1800MHz GSM licences are currently up for renewal, shortly to be joined by some of the 3G licences issued at the turn of the new millennium. In some markets such as Singapore the 3G renewal process is already underway.

Often the original licences offer little insight into what happens at the end of the licence period and the renewals process is one for which regulators have adopted a wide range of approaches. Some countries such as Portugal have simply renewed the licences, others such as France have renewed some spectrum rights to the existing owners and then re-assigned the remaining rights to others. Some regulators have not adopted this administered approach but have decided to re-auction the spectrum, as has been the approach in Ireland, Switzerland, the Netherlands and Singapore.

There have also been some innovative hybrid approaches such as in Australia and New Zealand where the regulator has provided the current holders with a “right of first refusal” at a government determined price. If the operators in these markets had opted not to retain the spectrum at the proposed price then they could have chanced their arm in an auction. In both cases they took the government price.

Whilst individual operators will probably complain about the results of the various approaches adopted and the amounts they have had to pay it is probably fair to say that so far there have been no major disasters. No operator has had to close up shop due to a loss of spectrum, no outcomes have led to a dramatic shift in the competitive landscape and we are not aware of any major customer disruption suffered.

The Norwegians however may provide the first real upset. Curiously they have selected a first price, sealed bid combinatorial auction model. There is a reason why first price sealed bid auctions are seldom used these days and that is because bidders must bid strategically and if any operator in Norway gets their bidding strategy seriously wrong the outcome could be interesting.

The mobile industry has now been around for more than 25 years in some countries and there have been various releases of spectrum since the start of the industry including 3G spectrum around the new millennium and more recently 2.6GHz spectrum and also 800MHz. Now there is also talk of 700MHz spectrum being allocated.During recent years there has also been a reasonable level of consolidation and any M&A activity has also given the regulator the opportunity to address any spectrum imbalances.

If a regulator has been doing their job well then in most markets by now the spectrum should be shared reasonably evenly between operators. In any case it is our view that the high levels of site sharing and the interest in active sharing and spectrum pooling would suggest that operators no longer regard their networks and the spectrum they hold as core strategic assets. Indeed, their willingness to sign up MVNOs to their networks suggest they are seeking competitive advantage elsewhere.

An auction only works well when there is competitive tension. The problem with an auction for existing spectrum rights is that any new entrant knows they will be outbid by the incumbents so the auction will only be contested by the existing players. The regulator, having worked so hard to avoid spectrum imbalances, will almost certainly put in place caps to ensure that spectrum does not end up being concentrated in just one operator’s hands. The result is that the allocation of the spectrum will change little and, more likely than not, the spectrum will be sold at the regulator determined reserve price as was the case in Singapore.

The use of an auction therefore seems to be rather pointless and creates uncertainty and risk for operators. Risk and uncertainty dampens the desire to invest and innovate which is not good at a time when governments want to see a rapid and extensive roll-out of LTE especially in rural areas. If there are no major spectrum imbalances that are affecting competition then why not simply renew the licences to the existing holders at an agreed price – of course what that price should be is another question altogether and we are watching developments in the UK with great interest.

]]>http://telecoms.com/197611/uncertainty-and-risk-the-results-of-spectrum-renewal-by-auction/feed/1http://telecoms.com/wp-content/blogs.dir/1/files/2013/11/Graham_Friend.jpgBelgian 800MHz auction raises €360mhttp://telecoms.com/197531/belgian-800mhz-auction-raises-e360m/
http://telecoms.com/197531/belgian-800mhz-auction-raises-e360m/#commentsWed, 13 Nov 2013 10:53:03 +0000http://www.telecoms.com/?p=197531Belgium’s three mobile operators, Belgacom, Mobistar and KPN-owned Base have each received 2 x 10MHz of 800MHz spectrum in the country’s latest spectrum auction, at a price of €120m per allocation. There were no other entrants in the auction, which was run by Belgian regulator BIPT.

The licences require that LTE services be available to 30 per cent of the population within two years, 70 per cent within four years and 98 per cent of the population within six years. Mobistar, which is the only one of the three Belgian operators that has yet to launch LTE, won the licence with the most demanding coverage obligations, which will require it to provide coverage to an additional 60 cities, mostly in Wallonia, offering 98 per cent population coverage of this area within three years.

Belgacom launched LTE at 1800MHz in November 2012, and had achieved 35 per cent population coverage by early June 2013, according to the Global Mobile Suppliers Association’s Evolution to LTE report. Belgacom said that it expects to achieve 50 per cent population coverage for LTE by the end of this year. KPN’s Base launched LTE1800 last month in 15 Belgian cities.

The latest spectrum allocation will enable the operators to fill out their coverage and provide higher quality in-building penetration, they said. In a position paper released to coincide with the auction results, KPN said: “The 800MHz license will enable high quality indoor coverage that is at least on a par with Wi-Fi deployments. Customers will enjoy continuous 4G LTE services wherever they are.”

Belgacom led the Belgian mobile market at the end of Q3, according to figures from Informa’s WCIS+, with 5.1 million subscriptions. Mobistar held second place with 4.4 million subscriptions, ahead of Base with 2.3 million.

Last month the Austrian LTE spectrum auction raised €2bn through the sale of 2 x 140MHz of spectrum at 800MHz, 900 MHZ and 1800Mz.

]]>http://telecoms.com/197531/belgian-800mhz-auction-raises-e360m/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2013/11/Belgian_Flag.jpgCzech regulator reschedules LTE auctionhttp://telecoms.com/171762/czech-regulator-reschedules-lte-auction/
http://telecoms.com/171762/czech-regulator-reschedules-lte-auction/#commentsFri, 16 Aug 2013 09:31:56 +0000http://www.telecoms.com/?p=171762The Czech Telecommunications Office (CTU) has announced that its LTE auction will begin mid November 2013. The Czech regulator abandoned its efforts to hold the auction in March this year, when bids spiralled out of control.

The regulator is auctioning 800MHz, 1800MHz and 2.6GHz spectrum. Entries to bid can be made until September 30, 2013, the CTU said. It added that it plans to grant the licences at the beginning of 2014.

A new entrant will be able to reserve spectrum as part of the new auction conditions, joining Telefonica, T-Mobile and Vodafone in the market. In the abandoned March auction, PPF Mobile Services was confirmed as a bidder for the spectrum.

“The objectives of the auction are clear,” said Jaromir Novak, chairman of the board. “We strive to develop new services, mobile broadband internet access and encourage competition, creating the conditions for the entry of another operator with nationwide operations, and ensure efficient use of spectrum.”

In March the CTU was forced to abort the auction after bids had already topped CZK20bn (€780m) and were still rising. The regulator decided to rein in spend to stop the charges being passed on to consumers.

“Such excessive prices of the auctioned frequencies would have to negatively translate into excessive charges for fast mobile internet,” the CTU said at the time. “We therefore consider it necessary to step in and prevent future negative consequences for the customers.”

]]>http://telecoms.com/171762/czech-regulator-reschedules-lte-auction/feed/0http://telecoms.com/wp-content/blogs.dir/1/files/2013/02/Prague-Czech.jpgAustralian regulator hits back at auction “failure” accusationshttp://telecoms.com/142021/australian-regulator-hits-back-at-auction-failure-accusations/
http://telecoms.com/142021/australian-regulator-hits-back-at-auction-failure-accusations/#commentsThu, 09 May 2013 09:56:52 +0000http://www.telecoms.com/?p=142021The head of the Australian telecoms regulator has hit back at allegations that the recent spectrum auction was “damaging to the economy” and dismissed claims that one of the country’s three operators was deterred from participating by high reserve prices. The criticisms were levelled at ACMA by the CEO of spectrum auction planning specialist Coleago Consulting on Wednesday.

Coleago’s Stefane Zehle suggested that, by setting too high a reserve price for the 700MHz spectrum auction, ACMA had deterred one of the three Australian mobile operators, Vodafone’s VHA, from bidding. “ACMA’s failure could hardly be more complete,” Zehle said, arguing that the price had resulted in a 2x15MHZ swathe of 700MHz spectrum going unsold.

But ACMA chair Chris Chapman has hit back at Zehle, telling Telecoms.com that, in October 2012, Vodafone announced it did not need to buy the spectrum that was being offered in the digital dividend auction because it has sufficient spectrum to provide LTE services in the future. “Vodafone’s CEO, Bill Morrow, made this announcement two months before the Minister directed the ACMA to set the reserve price for the 700MHz band at A$1.36/MHz/pop,” Chapman said.

He added that Vodafone had also refrained from bidding for licences in the 2.5GHz band, “even though it is hard to characterise the reserve price for this band (A$0.03 per MHz/pop) as extremely high, and indeed all 2.5GHz lots were sold.”

The auction generated revenues of nearly A$2bn, yet Zehle claimed that “potentially several billion dollars of benefit to the economy had been lost,” given that the auction was estimated to deliver a net benefit to the Australian economy of between A$7bn and A$10bn.

Chapman argued that Zehle’s assessment of net benefit was well beyond figures quoted for expected auction revenue in the media and seem to be based on speculations about the overall economic benefits resulting from subsequent network rollout and operation. “Such benefits would, of course, be hard to calculate from the auction results alone,” he said.

“The ACMA expects that consumers will benefit from the substantial increase in spectrum holdings for Telstra and Optus resulting from this auction. Telstra and Optus would not have bought this spectrum if they didn’t believe it would improve their position in offering competitive services to consumers. Vodafone says it also intends to compete vigorously in the mobile broadband market using its existing spectrum assets. In addition, the auction has brought a new entrant to the market (TPG Internet ) with its own spectrum holding.

“The ACMA is optimistic that all these companies will invest in the community when they commence 4G services, which will further transform the way Australians communicate and do business,” Chapman said.

On the matter of unsold spectrum, ACMA confirmed that three continuous lots, or 15MHz paired, of 700MHz spectrum remains vacant and available for allocation to the Australian industry at some future date.

At the time of cancellation, bids had already topped CZK20bn (€780m) and were still rising. While this sounds like good news for the Czech treasury, the regulator has taken the very sensible approach of reigning in spend to stop the charges being passed on to consumers.

“Such excessive prices of the auctioned frequencies would have to negatively translate into excessive charges for fast mobile internet,” the CTU said. “We therefore consider it necessary to step in and prevent future negative consequences for the customers.”

A new auction will likely take place within a couple of months, when the CTU has had to opportunity to put pricing safeguards in place.

Between 10:00 and 16:00 on December 11, 2012, interested parties are able to submit applications, accompanied by an initial deposit of £100,000 into Ofcom’s bank account. The passing of the deadline takes the UK one step closer to the completion of a highly controversial and long-awaited spectrum action, which is expected to be finalised by February or March next year.

As far as the UK’s mobile operators are concerned, the auction can’t happen soon enough. Despite the encouraging signs seen since EE went live, the UK is still lagging far and away behind the world’s most advanced 4G markets.

To put this in context, according to Thomas Wehmeier, Principal Analyst at Informa Telecoms & Media, by the time the remaining 4G networks are switched on at some point in the middle of next year, more than one-third of Korean and about 20 per cent of Japanese consumers will already be actively using 4G services in their respective countries.

“But that’s not to say that we don’t expect to see a marked acceleration in the pace of 4G adoption in the UK next year. By that point, most of the high-end flagship phones on sale in the UK will support 4G technology, we can expect to see some pretty competitive pricing as the markets kicks into life and the inevitable blanket market campaigns are sure to lift interest in and adoption of 4G amongst UK consumers,” he said.

Analysts are expecting the amount raised to represent just a fraction of the record £22.5bn spent during the 3G licensing round in April 2000, during exceptional times, before the dotcom bubble burst. The industry will be much more cautious this time around, not least because of the weak economy and the declining revenues that many operators are suffering in the UK and across Europe.

In his recent Autumn Statement, the UK Chancellor George Osborne pegged the amount the UK Treasury is hoping to raise at £3.5bn, which puts the official view slightly above industry expectations, but broadly on par with the amounts raised in similar auctions in other European markets such as Germany.

Informa is expecting the auction to attract all the usual suspects , meaning the UK’s existing mobile operators Vodafone, Telefonica O2, 3 UK and, of course, EE, which will be looking to bolster its existing 4G spectrum position.

“What we don’t know and can’t predict is whether we’ll see any wildcard bids. There’s been plenty of industry speculation about the possibility of some of the UK’s other telecoms and media powerhouses, the likes of Virgin Media, Sky or BT, entering the fray, but the experience of looking to other markets that have held similar auctions means we should be surprised if there is a genuinely disruptive and large-scale bid from one of the players. It can’t be ruled out, but it would certainly be unexpected,” Wehmeier said.